Koppers Accepts $1.7-Billion Offer : Sweetened Bid by Beazer-Led Group Ends 3-Month Battle

Koppers Co. dropped its fierce resistance to a hostile takeover bid Wednesday, succumbing to a $1.7-billion offer from British industrialist Brian C. Beazer and abruptly ending a three-month battle that caught congressional attention.

The sudden collapse of Koppers’ opposition to the takeover spelled the end of independence for the construction materials and chemicals company, one of the largest U.S. road repair concerns and a major Pennsylvania employer.

Beazer’s struggle to acquire Koppers aroused intense hostility in the state, led to legal wrangling in federal court and ignited a blacklisting campaign against his investment-bank supporter in the deal, Shearson Lehman Hutton Inc. The battle also compelled local members of Congress to introduce anti-takeover measures.

“We set out to keep the company independent, but business as it is currently conducted didn’t give us that opportunity,” Koppers Chairman Charles Pullin told a news conference Wednesday afternoon.

The resistance broke down after a prospective buyer for part of Koppers’ construction materials business backed out of a tentative deal May 22, Pullin said.

Strengthens Beazer Unit

Under the deal with Beazer, key managers will receive accelerated payments of a deferred compensation plan, which terminates with the merger, Pullin said. But “nobody is going to get more under this merger than they had when Koppers was . . . totally independent,” he said.

The deal will significantly strengthen Beazer’s construction company, Beazer PLC of Bath, England. The industrialist said in a statement: “It has taken more time and effort to achieve our goal, but achieve it we did.”

Koppers battled the takeover attempt from its beginning on March 3 as a $45-a-share hostile tender offer from BNS Inc., a takeover partnership comprised of Beazer, Shearson and County Natwest Ltd.

Led by Pullin, Koppers said at one point during the struggle that it could beat Beazer’s $60 offer with a recapitalization plan, but the plan never materialized.

“Now that the drama has ended, we are looking forward to getting on with the job, putting together a world class aggregates company and beating the competition,” Beazer said.

On Wall Street, Koppers stock closed at $60.50 a share, up $1.50.

Koppers spokesman Robert O’Gara said the settlement was “almost bittersweet” for the company’s 11,000 employees, including 1,150 at the Pittsburgh headquarters.

“Bitter because the company is probably no longer going to be a company and sweet because the aggravation is going to be over, and the indecision is going away,” he said.

“We were a rare company to last as long as we did,” O’Gara said.

Employee Issues Discussed

BNS raised its offer to $60 a share on March 25 and sweetened it by $1 during the weekend talks.

“That’s a good value for Koppers shareholders,” said analyst Christopher H. Willis of Brown Bros. Harriman in New York.

“When all this came out, I thought the company was worth $55” a share, said Jack Henry of Merrill Lynch.

Shareholders of Beazer PLC approved the acquisition of Koppers March 20.

O’Gara said the weekend talks were followed by telephone negotiations on employee issues.

Among mid- and lower-level employees, “there’s still a faith in management that the severance and transfer benefits will be as generous as they can make them,” he said.

The pressures on Koppers management included a threat from the takeover partnership BNS Inc. to sue to stop the company from selling businesses to finance the recapitalization.

Koppers won anti-takeover injunctions in U.S. District Courts in Los Angeles and Pittsburgh. The California ruling, concerning antitrust issues, fell last week on appeal, and the judge in Pittsburgh offered BNS options for overcoming apparent violations of securities laws.